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As the subprime-mortgage market continues to implode, investors are struggling to figure out which companies, banks or hedge funds are holding what could potentially be hundreds of billions of dollars of bad debt. According to SIFMA, about $773 billion in mortgage-related securities was issued by Wall Street firms in 2006, more than triple the amount issued in 2001.

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Speculation that demand will increase as investors continue to seek safer options is pushing up Treasury notes. Stoking concerns about the spreading mess in the subprime-mortgage market, Australia's Basis Capital Fund Management is seeking bankruptcy protection for one of its hedge funds.

Although Nasdaq and the New York Stock Exchange are more established, Bats Trading is gaining ground as it prepares to add the International Securities Exchange to its client roster. The Kansas City-based electronic system is currently testing the ISE's order-delivery system. At this time last year, Bats trading was at 5 million shares daily; on Wednesday, the system executed a record 758 million shares.

A proposal to give shareholders greater control in how corporate directors are elected may be derailed after the resignation of one of the two Democratic members on the Securities and Exchange Commission's five-member board. John Olson, a corporate-governance lawyer with Gibson, Dunn, & Crutcher LLP, said the controversial measure went "from iffy to negligible" with the resignation of Roel Campos.

The Securities and Exchange Commission is looking at the finances of leading Wall Street firms to see if they are hiding losses from the collapse of the subprime-mortgage market. The normally routine checks come at a sensitive time, as none of the firms had reported big subprime losses as of their last earnings reports. "No one really knows how to price asset-backed securities and CDOs and that's a real problem in the market now," said Ann Rutledge, principal of R&R Consulting.

A Wall Street Journal editorial goes after Rep. Barney Frank, D-Mass., for filing an amicus brief urging the Supreme Court to make it easier for trial lawyers to sue corporations. The newspaper takes issue with Frank's using a tort lobbying firm to assist in writing the brief. "We trust the Supreme Court Justices, who are due to hear Stoneridge arguments as early as October, will notice the provenance of Mr. Frank's legal wisdom," the newspaper concluded.